The State of Management and the Role of the Ethiopian Management Professionals Association (EMPA)

By Yifru T.
Yifru2006@yahoo.com

The challenges of the Ethiopian Enterprises and the role of Management Profession
A survey made by the Ethiopian Economic Association in 2005 about the characteristics of large and medium scale manufacturing enterprises in Ethiopia indicated that they were characterized by lack of market demand, low competitiveness in the market, under-capacity utilization, low labor productivity and profitability, backward technology, little integration, and high dependency on external supply of materials. The Central Statistical Agency of Ethiopia in its annual reports of October 2007 confirmed that among the total manufacturing enterprises which operated less than 12 months about 37% and 22% indicated that shortages of supply of raw materials and absence of market demand stood as the first and second major problems that caused under capacity utilization respectively. The importance of management as one of the necessary inputs in business or any organization has never been mentioned in any of the publications mentioned above. Why management has not been given serious attention as one of the critical inputs that determines the success and failure an organization could perhaps be because of its manifestation in every character of an organization.
As the famous management guru, P.F. Drucker once argued “there are no underdeveloped nations as such, but under managed ones”. In a country where a great deal of its people are living in absolute poverty, and many firms are not yet librated from poorly at times untrained owner managers, the importance of professional managers becomes more critical than ever before. As a member of COMESA, and would be member of WTO, Ethiopia certainly will face severe shortages of able managers who can run their organizations competitively in regional and global markets. When our markets are open as a result of accession of WTO, and other regional trade blocks, how ready are our firms to compete and survive in business? Firms can buy machineries, technology etc to run their businesses but to what extent are they investing in their human capital in order to mitigate the prevailing management problems are an issue of concern to many of us.
At the national level, we know there are some efforts going on in “branding Ethiopia” which is a very good initiative to boost the image of the country. However, the question is how do we first remove some of the negative images created so far in the minds of the peoples? Then, what are some of the competitive advantages of Ethiopia, say compared to Kenya, Sudan etc? Branding is all about creating meaningful differentiation! Currently, the only sources of competitive advantages the country has could be its people and land although Michael Porter (1990) argues that the traditional theory of comparative advantage based on factor endowments has become less relevant. However, he further argues that industries and nations can become successful even with limited factor endowments if they pursue appropriate policies and develop expertise in particular sectors. According to him competitiveness at the national level has to be defined in terms of the ability to maintain high and rising productivity through the following four inter-related determinants:
• Factor conditions: This includes the availability, quality, and cost of factors of production, including labor, capital, natural resources, infrastructure, and “knowledge resources”.
• Demand conditions: Large domestic market for the good with quality-sensitive consumers enhances competitiveness which provides the motivation for industries to continually improve quality, service, and value, preparing them for competition in the world market.
• Related and supporting industries: competitiveness of a sector depends on the existence of firms in related industries to provide support services, capital goods, inputs, and information.
• Firm strategy, structure, and rivalry: the competitiveness of firms among themselves creates incentives for continual improvement, particularly when the competition is for quality and service rather than mere price competition. The business culture, prevailing norms, and the regulatory environment affect the vigor with which firms compete against each other.
A sustainable competitive advantage can only be secured through the application of sound management principles that fosters creativity, envisioning, empowerment, good corporate culture etc. Are our people trained and have the right culture? I mean well trained in major key fields, particularly in the field of management? Do we have the right attitude and culture to work to a common goal? We regrettably have limited number of well-trained and seasoned managers who can lead by example and shape the future course of actions of their businesses for better result and success. Scarcity of skilled managers coupled with less productive labor force thus becomes more of a liability than an asset. The efforts currently undergoing by the government to attract foreign investments and creating an enabling business environment for the locals may be curtailed by shortages of seasoned management professionals. Professional associations like EMPA would definitely play an important role in bridging the management skills and knowledge gaps of firms, thus ensuring the competitiveness of firms in the market.

The Ethiopian Management Professionals Association (EMPA) and It’s Roles
The Ethiopian Management Professionals Association (EMPA) was born on January 14, 1992, registration certificate number 321/59 with the objectives of enhancing the managerial skills and knowledge of its members, and promote the management profession in the country. However, the association was not functioning as such for the last eight years due to mainly lack of proper leadership and committed members. As most management writers agree, when I say leadership problem, I mean leadership is a function of the leader, the followers, and the situation. The executive committee of EMPA should take the prime responsibility for what so ever the reason might be for failing to live up to the objectives of the association. It is also obvious that any organization, for that matter, is as good as its members. The members of EMPA, as followers and supporters, should be blamed for failing to actively participate and/or taking the initiative to help the executive committee. The issue of leading could be difficult when it comes to such associations like EMPA where members and leaders have no monetary incentives unless they have the commitment and the passion for the profession.
However, when we see the strength and dynamism of EEA, one of the best association in the country, and other professional associations, it is normal to ask what is going on with the management professionals. I was invited to attend one of the EEA’s meetings that was held at ECA Hall where the Prime Minister presented his “Democratic Developmental State” thesis. The diversity of the participants, let alone the active participation of the members, was indeed incredible. I feel sad and sometime ashamed of our management professionals and scholars for not playing their professional roles in an organized manner.
I have somehow tried to touch some of my concerns that revolve around the management profession in Ethiopia. I believe this is also the concern of many other management professionals who would like to see EMPA succeeding. Cognizant of this role, the 2007 graduates of management of AAU had boldly addressed the issue and formed a Steering committee to reorganize EMPA. Let us join hands once again to support the reorganization of the association by actively participating as members, leaders, and advocators so that it can play its roles properly for the liberation of the management profession in Ethiopia.